Collaborative Law: Codified Under North Carolina Statutes

Posted on December 14, 2011 by M. Douglas Berry

Effective October 1, 2003, the general concept of collaborative law was given statutory life through Article 4 of the General Statutes of North Carolina, Sections 50-70 through 50-80.  Collaborative law was officially established as an alternative to the judicial disposition of issues arising out of a civil family law action (except for claims for absolute divorce).

A collaborative law proceeding is defined by statute as a proceeding where a husband and wife, contemplating separation or divorce, and their attorneys, use their best-faith efforts to attempt to resolve the disputes on an amicable basis without having to resort to judicial intervention except to the extent necessary to approve settlement agreements and sign orders to effectuate the agreement.

The attorneys agree that they will not, in turn, file any litigation on behalf of their clients, and the clients accept the model of resolving their issues without having to go to court.  The statute requires a written agreement between the parties and their attorneys.  A collaborative law agreement must be in writing, signed by all parties and their attorneys and must include provisions for the withdrawal of the attorneys involved in the event that the collaborative procedure does not result in a settlement of the dispute (N.C.G.S. § 50-72).

A valid, executed collaborative law agreement tolls (holds in abeyance) any applicable statute of limitations, filing deadlines or other time limitations imposed by law or court (hearing dates, trial dates, discovery deadlines and other scheduling orders) (N.C.G.S. § 50-73).

In an ongoing civil action, the filling of a collaborative law agreement stops the procedure with the court and the court shall take no action in the case, including a dismissal, unless the court is notified that the parties have either failed to reach an agreement, voluntarily dismissed the action or asked the court to enter an order or judgment incorporating the agreement of the parties (N.C.G.S. § 50-74).

A collaborative law agreement is entitled to the full faith, credit and force of a court-ordered judgment upon the request by the parties (N.C.G.S. § 50-75).  In the event the parties fail to reach a collaborative law agreement, either party may file a civil action unless the collaborative law agreement provides for the use of arbitration as an alternative dispute resolution.  If a pending civil action has been stayed (held in abeyance), then the court is then given notice that a settlement agreement has not been reached and the court pursues the regular litigation course.

If a civil action is filed pursuant to this section, the attorneys involved in the efforts at collaborative law cannot be the attorneys for the parties in the actual civil proceeding and shall withdraw as attorney of record (N.C.G.S. § 50-76).

Collaborative law proceedings are confidential and are not admissible in any court proceeding.  Any statements, communications or work-products (exhibits, charts, graphs) or any other written or verbal communications or analysis by third-party experts are included in this privilege and are inadmissible evidence  (N.C.G.S. § 50-77).

Collaborative law agreements also incorporate the alternative dispute resolutions including mediation and/or binding arbitration to reach the settlement of any disputed issues that cannot be resolved by agreement.  This is a sensible way to resolve any impasses without the whole process breaking down.  For instance, if the parties need to get an evaluation of a piece of real estate that they cannot agree on, then they can agree to an abbreviated arbitration process wherein an experienced real estate appraiser would be chosen to conduct a hearing and take evidence and enter into a binding arbitration ruling on the question of value.  This process of incorporating alternate dispute resolutions is incorporated in N.C.G.S. § 50-78.

In the unlikely/unfortunate event of death of one party to the collaborative law proceeding, the proceeding can continue and does not have to abate by having the personal representative of the deceased party’s estate continue the collaborative law proceeding (N.C.G.S. § 50-79).

In an attempt to recognize the social utility and financial practicality of promoting collaborative law as an alternative means of dispute resolution, the North Carolina General Assembly and Legislature have given teeth and legitimacy to a collaborative law agreement properly structured between two experienced collaborative law attorneys.

Anyone who is involved in a potential or ongoing court fight over matters of equitable distribution (property settlement), custody, alimony, child support and any other financial issues should seriously consider collaborative law compared to the mutually assured financial and emotional self-destruction that can be involved in a protracted, bitter court fight.

At the end of the day, collaborative law allows the divorcing parties to direct their focus and their resources less on the fight and more on the fix.

If you have any further questions about engaging in the collaborative law process and working out the dissolution of your marriage, contact M. Douglas Berry, Family Law and Divorce Lawyer at www.gabrielberrywestonlaw.com

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Alienation of Affections Verdict – Jurisdiction Upheld Against California Defendant

Posted on December 14, 2011 by M. Douglas Berry

In the August 3, 2010, case of Brown v. Ellis on remand to the North Carolina Court of Appeals, the North Carolina Supreme Court and the North Carolina Court of Appeals upheld personal jurisdiction of a North Carolina husband for his claim for damages for alienation of affections and criminal conversation and unlawful interference with his marriage in North Carolina.  Although the Court of Appeals reversed the jury verdict based on insufficient notice given to the defendant of his need to be in court for trial, the Supreme Court established the long-arm jurisdiction of North Carolina over residents of other states for interfering with the marital relationship.

The alienation of affections and criminal conversation claims were based on conduct of the defendant which involved no actual physical presence within North Carolina.  The Court of Appeals held that as long as there were minimum contacts with the State of North Carolina, a party who lives out-of-state can be held liable for the breakup of a North Carolina marriage.  Minimum contacts necessary to establish the jurisdictional basis for this claim involve analysis of several factors.

First, the quality of the contacts between the California defendant involved almost daily contacts with the plaintiff’s wife in North Carolina by telephone and e-mail.  The quality of the defendant’s contacts were sufficient when considering that they had the effect of the destruction of the plaintiff’s marriage.  These contacts involve pursuit of a “sexual and romantic relationship with” plaintiff’s wife, and daily contacts which had a direct role in breaking up the marriage.  The interest of North Carolina courts are especially significant because these alienation of affections and criminal conversation torts are not recognized in many states.  In many states one cannot bring an alienation of affections or criminal conversation claim against the defendant because that state does not allow it.  California, in this case, abolished alienation of affections and criminal conversation in 1939.  The inconvenience to a California resident of having to come to North Carolina was outweighed by the totality of these factors.  The Court concluded that traditional notions of fair play and substantial justice are not affected by allowing a California resident to be sued for unlawful interfering with the marital relationship.

The impact of the Brown v. Ellis decision is to recognize the validity of protecting the marital relationship in these modern times of the internet, e-mail, texting, Facebook and other electronic communications.  If an out-of-state party contacts a married person in North Carolina with the intent of endearing himself or herself to that party and pursuing a more intimate relationship to the detriment of the North Carolina resident’s marriage, that interfering party can be held financially responsible for the break-up of the marriage and the financial and emotional havoc which invariable results from the marital dissolution.

By:  M. Douglas Berry, Family Law and Divorce Lawyer
Greensboro, North Carolina
www.gabrielberrywestonlaw.com

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Court Lacks Jurisdiction Over Property Issues

Posted on December 5, 2011 by Richard W. Gabriel

The North Carolina Court of Appeals in a case filed October 4, 2011, in the matter of Tripp v. Tripp, held that the Superior Court of New Hanover County lacked subject matter jurisdiction over the claims by one of the parties filed in Superior Court for quiet title, breach of warranty of title, fraud, unjust enrichment and contribution.  When the superior court action was filed, a Brunswick County action seeking equitable distribution had been previously filed and was still pending.  The Court of Appeals held that when matters of property involving equitable distribution are pending in a district court, a subsequent action filed in superior court involving the same property is improper.  In reaching an equitable distribution of marital property, a court can look at all relevant factors.  Since the issues involved in the equitable distribution case are substantially similar to the claims shared by the party plaintiff in the Superior Court case, the Superior Court had no subject matter jurisdiction.

Richard Gabriel
Gabriel Berry Weston & Wells
Greensboro, NC

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North Carolina Supreme Court Allows Termination Of Alimony Due To Cohabitation

Posted on December 5, 2011 by M. Douglas Berry

In the decision of Underwood v. Underwood filed August 26, 2011, the North Carolina Supreme Court reversed the Court of Appeals and the trial court and held that an alimony obligation in a court order should terminate because of the cohabitation of the dependent spouse.  The parties entered into a consent order providing that the alimony payments were given in reciprocal consideration for the agreements of the parties as to equitable distribution and property settlement.  Pursuant to North Carolina law, if the provisions of a consent order are part of an integrated property settlement, then the alimony terms are non-modifiable.  However, the mere recitation in the consent order that a provision is given reciprocal consideration for other provisions does not automatically render the alimony non-modifiable.  The Court must look at the true nature of the alimony as described in the court order and determine whether it is truly treated as alimony under North Carolina law.  In the Underwood decision, all of the aspects of alimony as defined by North Carolina law were present.  The Underwood decision illustrates the risk that the incorporation of alimony provisions in the court order can result in the unintended modifiability of the alimony.

By:  M. Douglas Berry, Family Law and Divorce Lawyer
Greensboro, North Carolina

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Court Rejects Father’s Attempt To Reduce Child Support

Posted on December 1, 2011 by M. Douglas Berry

The North Carolina Court of Appeals in the decision of Andrews v. Andrews (November 2011) was presented with the father’s attempt to reduce child support.  The father had previously held a job earning $172,000 a year.  He then voluntarily resigned his position without having secured other employment.  In his exit interview he stated that he was resigning to “follow Jesus Christ”.  At the time of his resignation, he intended to start a church but the church was not yet incorporated and there was no paying position to accept.  Consequently, the prospective members of the church made a “love offering” of $1,000 to sustain him until payment of his salary could begin.  In mid-May, the New Beginnings Chapel was established and the Plaintiff accepted a position with the church as a senior pastor with a beginning salary of $52,800 but with no health insurance benefits.  The Plaintiff’s premiums for health and dental insurance doubled while his income was reduced by approximately 70%.  The Plaintiff filed a motion to modify his child support obligation alleging there had been a substantial change in circumstances.  When asked if he considered his child support obligation when he quit his engineering job, the Plaintiff’s response was, “when I considered leaving EMC My consideration was following Jesus Christ and that was all, my obedience to him.”

The trial court found that, as a matter of law, there was sufficient evidence to establish a substantial change in circumstances based on the father’s reduced income.  The Court of Appeals reversed holding that a parent’s voluntary unemployment or underemployment does not constitute a substantial change of circumstances when it is the result of bad faith or deliberate suppression of income to avoid or minimize a child support obligation.  In such a case, the parent’s potential rather than actual income can serve as a basis for the child support determination.

The Court of Appeals noted examples of bad faith: (1) failing to exercise his reasonable capacity to earn, . . . (3) acting in deliberate disregard for his support obligations, . . . (6) deliberately not applying himself to his business, . . . or (8) intentionally leaving his employment to go into another business.  Prior examples of a court disregarding the reduction in income and imputing a higher wage earning ability include the following:

(1) professional football player retired from his career and took a job working 1 day per week and presented no evidence that he could not work more hours at the same job;

(2) a mother who was voluntarily unemployed and had no intention of finding employment and, although she had substantial financial assets, made negligible contributions to the support of her children.

On the contrary, the court in prior decisions had found that a father quitting his job to return to school but creating a plan to meet his child support obligations while unemployed was not an example of bad faith.

In the Andrews case, the Court of Appeals held that although there is no evidence that the Plaintiff intentionally reduced his income to avoid his child support obligations, there was sufficient evidence that he acted without considering his ability to meet his child support obligations.  Making the job decision without considering his child support obligations including his failure to secure alternative employment was a deliberate disregard of his support obligation.  The Plaintiff’s voluntary reduction of income, while based on seriously held religious beliefs, did not excuse him of his duty to comply with a valid child support order.

By:  M. Douglas Berry, Family Law and Divorce Lawyer
Greensboro, North Carolina

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No Contempt Of Court For Violating An Erroneous Order

Posted on December 1, 2011 by M. Douglas Berry

The North Carolina Court of Appeals in the decision of
Church v. Church (now Decker) (November 2011) reversed a trial court
decision holding the Plaintiff in contempt on the grounds that the underlying
Order that the Plaintiff was held in contempt for violating was subsequently
reversed.  If the underlying order is ineffective, then the Plaintiff cannot be found in contempt for failure to comply with such a judgment.  The Court of Appeals then held that taxing him with the costs and attorney’s fees at such a hearing was likewise ineffectual and should be set aside.  The trial court’s assessment of attorney’s fees was, therefore, reversed by the Court of Appeals and the case was remanded to the trial court for further proceedings consistent with its opinion.

By:  M. Douglas Berry, Family Law and Divorce Lawyer
Greensboro, North Carolina

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South Carolina Resident Immune From Liability For Alienation Of Affections Case

Posted on December 1, 2011 by M. Douglas Berry

In the recent North Carolina Court of Appeals decision of Bell v. Mozley (November 2011), the Defendant was a resident of the State of South Carolina with frequent business contacts bringing him to North Carolina.  The Defendant admitted to sexual relations with the Plaintiff’s wife in South Carolina, New York, California and Hawaii.  The Defendant was an invited guest at the Plaintiff’s home in Blowing Rock, North Carolina for approximately three days in 2006 around New Year’s Eve.  The only additional evidence of the Defendant’s contact with the Plaintiff’s wife in North Carolina were three phone calls over New Year’s 2006 lasting approximately 5 minutes.  The Plaintiff, however, had no personal knowledge or direct evidence of any additional contact between the Defendant and his wife in the State of North Carolina.  The Court held that even though there was a finding of continuous and systematic contacts between the Defendant and the State of North Carolina, the source and connection of these contacts were strictly related to business.  The Court of Appeals held that the fundamental fairness requirements of due process would be violated by exercising personal jurisdiction over the Defendant.  Because South Carolina did not recognize any civil claim for alienation of affections or adultery, there was no claim that could be brought against the Defendant and the case was dismissed.

M. Douglas Berry
Gabriel Berry Weston & Wells
Greensboro, NC

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North Carolina Legislature Gives Father of Unborn Child Claim for Civil Damages Against Abortion Provider

Posted on November 22, 2011 by M. Douglas Berry

In a recent statutory provision N.C.G.S. § 90-21.80 et seq., the North Carolina legislature passed the Woman’s Right to Know Act which enacted certain restrictions with regard to obtaining an abortion.  Part of the statutory provision includes § 90-21.88 which provides that any father of an unborn child that is subject to an abortion has an action for damages against the person who performed the abortion if done in violation of this article.  The remedies include monetary damages and injunctive relief.  N.C.G.S. § 90-21.88 also provided for the assessment of attorney’s fees in favor of the plaintiff.  Attorney’s fees, on the other hand, for frivolous actions brought in bad faith can be assessed against the plaintiff.  The recent Federal Court decision of Stuart v. Huff in the Middle District of North Carolina issued October 25, 2011, issued a preliminary injunction enjoining the enforcement of  part of the woman’s right to know act, specifically § 90-21.85 for violation of first amendment principles.  The speech and display requirements of § 90-21.85 were held to be likely unconstitutional for violation of first amendment principles and are presently enjoined from enforcement.  The remainder of this act, however, is now in full force and effect.

Douglas Berry

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Who is Responsible for The Debts of a Deceased Parent?

Posted on November 7, 2011 by Richard W. Gabriel

A child is not responsible for the funeral expenses of a deceased parent, unless the child has personally signed for the arrangements.  In the absence of a pre-planned funeral arrangement, often referred to as a “pre-need” arrangement, the person(s) who contact the funeral home and make the final arrangements  often sign for the costs and are thus obligated to pay.  Some will do this understanding that they have life insurance or other funds payable directly to them for this purpose or do so out of a sense of obligation to the deceased. Other family members are not legally required to contribute to a funeral unless they have agreed to do so in writing.

However, the deceased’s estate assets are subject to a claim of lien for funeral expenses if they are not otherwise paid or provided for.  N.C.G.S. 28A-19-6 sets out the order of priority for claims against an estate.  Funeral expenses not to exceed $3,500.00 are a lien against property of the estate, and are a second class priority.  Gravestones and burial plots are a lien to the extent of $1,500.00 and are a third class priority.  Amounts in excess of these sums are still obligations of the estate, but are relegated to ninth class status as to the balance of the amount owed.

There are other statutes that impact the ability of the personal representative of the estate to make final arrangements that are charged to the estate.  It pays to be cautious in this arena.

Richard Gabriel

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Does a Change in the Name of a Beneficiary Require a Change in My Will?

Posted on October 19, 2011 by Richard W. Gabriel

It is not necessary to change her name in your will and trust, although some people prefer to do so in recognition of the marriage.  The marriage certificate or license would show that your daughter is the same person.  However, the better practice is to amend your documents, especially if there has been more than one change of name resulting from marriage.  In general, most heirs know each other and the change of name is usually known by the others.  Should your beneficiaries not know each other, or not all be family members, changing the document to eliminate any possible uncertainty is worthwhile. In general, it is a good idea to review your estate planning documents at least every five years, including powers of attorney, to be sure they are up to date and reflect your intentions.

Richard Gabriel
Gabriel Berry Weston & Wells
Greensboro, NC

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